Jerome Powell can't seem to talk markets down. The Fed raised rates by 25 bps as expected and the chair signaled at least two more similar hikes are on the way while emphasizing the need to stay restrictive for some time. He welcomed signs that prices are moderating and didn't push back as hard as anticipated on the recent loosening of financial conditions. Powell discounted the prospect of a 2023 rate cut, but swaps now are pricing in 50 bps of reductions by year-end.

US stocks and bonds jumped on Powell's relatively dovish comments. The S&P 500 rose more than 1%, erasing a decline of almost that much, and the Nasdaq added 2%. Treasury yields turned tail and dropped, with 2-years falling 11 bps and 10-years 10 bps, sending the dollar down across the board. Oil weakened and gold advanced. Asian equity futures are narrowly mixed.